“What is the Effect of Statutory Discretion on Agency Loss? Evidence from the U.S. States”

What is the effect of state charter school authorization, renewal, and revocation statutory discretion on charter school growth? Advocates suggest that charter school authorizer type and authorizers’ statutory discretion account for charter school growth. However, 90 percent of practicing authorizers have been local school boards of education in recent years. In order to address this puzzle, academics and advocates need to evaluate the effect of authorizers’ statutory discretion on charter school growth. I argue that a decrease in state charter school authorization, renewal, and revocation statutory discretion results in an increase in a state’s charter school growth. A decrease in statutory discretion legally compels an authorizer to administer fair and consistent decision making, which results in an increase in charter school growth. I evaluate the effect of charter school authorization, renewal, and revocation statutory discretion on charter school growth across 41 states with charter school laws from 1998 to 2013. The results consistently show that a decrease in statutory discretion increases the percent of operating charter schools, the percent of public school students enrolled in a charter school, and the percent of black and Hispanic public school students enrolled in a charter school in a given state.